World-famous cryptologist/security expert Bruce Schneier, on self-enforcing protocols:

There are several ways two people can divide a piece of cake in half. One way is to find someone impartial to do it for them. This works, but it requires another person. Another way is for one person to divide the piece, and the other person to complain (to the police, a judge, or his parents) if he doesn't think it’s fair. This also works, but still requires another person -- at least to resolve disputes. A third way is for one person to do the dividing, and for the other person to choose the half he wants.

That third way, known by kids, pot smokers, and everyone else who needs to divide something up quickly and fairly, is called cut-and-choose. People use it because it’s a self-enforcing protocol: a protocol designed so that neither party can cheat.

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Here’s a self-enforcing protocol for determining property tax: the homeowner decides the value of the property and calculates the resultant tax, and the government can either accept the tax or buy the home for that price. Sounds unrealistic, but the Greek government implemented exactly that system for the taxation of antiquities. It was the easiest way to motivate people to accurately report the value of antiquities.

I like.